Mirrored object stays in the same place
I did what I wanted to achieve by setting Pivot Point to 3D cursor and then mirroring. Still doesn't make sense to me, when I execute a mirror around a global axis I expect to see my object on the other side of that global axis, without playing with pivot point.

EDIT:

Please check this screen shot, 3D manipulator widget has an orientation selector (in this case selected to Global) and Mirror Transform also has an Orientation selector (Local). What are their effect for mirror transform. 3D manipulator has an effect at all?